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Naver, South Korea’s leading internet search engine, is poised to offer customised versions of its latest AI to foreign governments who are concerned about US data controls.
Unlike Microsoft and Google, which focus on universal AI models, Naver aims to develop localised AI applications for countries with political sensitivities and non-English speaking countries. This move comes as governments in the Arab world, Spain and Mexico seek AI systems tailored to their political and cultural contexts.
“This will be a massive business as sovereign AI technology is becoming increasingly important for data protection,” Sung Nako, a Naver executive told Financial Times. He likened exporting Naver’s AI models to building atomic power plants abroad, offering lower prices compared to Western competitors like Amazon.
Recently, Naver signed a preliminary agreement with Saudi Arabia to provide IT services, including AI tools, to support the country’s transition to the digital economy.
It is to be noted that countries have raised concerns regarding the control of the United States over the data stored in American companies’ cloud systems and Naver is looking to monetise this opportunity. However, experts caution that Naver may be overly optimistic about overseas sales of its AI systems, given its previous struggles to expand its search engine beyond the South Korean markets.
While Naver plans to prioritize the Korean market with its HyperClova X upgrade, it acknowledges the potential of overseas markets and the importance of localising AI services. Despite being technologically behind OpenAI’s ChatGPT, Naver believes its AI capabilities for Korean services will outperform ChatGPT.
With Naver’s foray into customised AI models for foreign governments presents an opportunity, challenges remain in terms of standardization and customisation for different countries. Naver will need significant financial and human resources to adapt its systems effectively. Nonetheless, Naver remains committed to capitalising on its strengths in the Korean and Japanese markets while eyeing expansion opportunities abroad.
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